Retailers’ Weapons of Mass Engagement

Over the past several years, retailers have had to adapt to new rules of engagement. Their customers are at once empowered, demanding, skeptical, and value-oriented, and they are flocking to social networks, online forums, blogs, and digital apps to satisfy their hunger for objective guidance and entertainment. In order to stay on their customers’ radars, retailers have had to shift from a focus on driving transactions through sales-channels to engaging shoppers across many touch points, some of which offer no direct ROI. Retailers have invested heavily in keeping shoppers fully engaged with their brands and many have graduated from gap-filling and moved on to building arsenals of options that attract and bond with shoppers as never before.

At last year’s National Retail Federation (NRF) Big Show, Mindy Grossman, CEO of HSN, spoke about how the company initially operated in two competitive silos, television and ecommerce. She described how she felt the need to break down walls and redefine “the win” as getting the multi-channel customer to shop at HSN, regardless of how they accessed products. Doing so required, among other initiatives, a reinvestment in HSN.com, which now ranks in the top ten most-visited ecommerce sites. HSN has since catapulted into a multi-platform retailer whose customers can shop in 12 categories, about 70% of the SKUs are exclusive to HSN, via TV, online, and mobile devices. HSN’s plan of attack, according to Bill Brand, executive vice-president for programming, is to offer “lifestyle editorial programmed commerce” that will build customers’ engagement, not just with products but with hosts and celebrity guests as well. Promotional events and partnerships, such as the company’s alliance with Sony Pictures, which showcased more than 400 products inspired by the Julia Roberts movie “Eat, Pray, Love,” give HSN even more ammunition in the form of branded entertainment tie-ins.

Eduardo Castro-Wright, Walmart’s vice chairman for ecommerce, recently acknowledged that, even a year ago, the retailer was not creating “the kind of shopping experiences across all channels that we are doing today.” Not one to easily surrender, Walmart has played an impressive game of catch-up this year. Just last week, it integrated its acquired streaming video service, VUDU, with Walmart.com and launched the @WalmartLabs division, which promises to bring Walmart up to speed with smartphone payment technology and mobile shopping applications, and push beyond into twitter-influenced product selection for its stores (@Walmartlabs is run by the two technologists that Walmart got in the bargain when it acquired social media analytics company Kosmix in April).

Gibu Thomas, Walmart’s senior vice president for mobile and digital units, envisions mobile phones serving “as a kind of docent for the Walmart shopper” in the near future, assisting shoppers with store selection, in-store navigation and item-level in-stock information. Walmart shoppers will be heavily armed, and just in time, as the retailer goes full swing into its multi-format strategy, which promises to customize the layouts, assortments and service offerings of particular stores or groups of stores. By bringing extra firepower in from outside, Walmart is demonstrating its willingness to deviate from its insular roots in order to win the battle for shoppers’ attention.

Bottom line:

Retailers have quickly moved from defense to offense in the fight for engagement, with each pursuing its own unique strategy. Want to learn what all of this means to your strategy? Don’t miss LIMA’s inaugural Retail & Branding Conference on September 13th in New York, where I’ll join executives from HSN, Sears Holdings and Iconix Brand Group to explore how leading retailers and brands are leveraging consumer touch points to drive brand impact in 2012 and beyond.
Speakers at the conference — “Driving Brand Impact Through Consumer Touchpoints” — include:

Jeff Fagel, Director of Brand Development, Sears Holdings.
With a select audience of no more than 100 attendees, and ample time for back-and-forth with each of the presenters, you’ll come away with exciting insights and new perspectives on consumer engagement. It promises to be an exhilarating day. Click here for more information and to register.Want to continue the conversation? We welcome your comments!
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Contact Carol directly at carol@newmarketbuilders.com or follow her on Twitter @retailxpert